Abstract

Through econometric and economic analyses, this dissertation addresses three key issues in the household educational decisions in Malaysia. First, by addressing selectivity bias, it provides new and more accurate information about the private rates of return to education in Malaysia. Second, using the Engel curve framework and the Hurdle model, this study examines whether there are significant gender differentials in intra-household educational expenditures in Malaysia and whether gender differences vary by ethnicity or geographical region. Third, this dissertation investigates the determinants of private tutoring expenditures in Malaysia using the Hurdle model.

The findings suggest that for both males and females, the average private returns to education are highest at the secondary (16.5 percent and 27.2 percent, respectively) and university (15.5 percent and 16.1 percent, respectively) education levels. The results also suggest that even after controlling for kind of work, there are substantial returns to education for both men and women at different levels of education. Additionally, the findings suggest that while there are no significant gender differences in intra-household educational expenditures nationally, these do exist in some regions, for the 5 to 9 and 10 to 14 age groups. However, such differences typically occur once children are enrolled in school. In terms of ethnicity, there is evidence of a pro-male gap in non-Bumiputera households’ decisions to enroll children ages 10 to 14 in school. Further, the results indicate that total household expenditures, household head’s level of education, household head’s gender, number of school-age children, home ownership, ethnicity and regional characteristics are important determinants of private tutoring expenditures in Malaysia.

Based on an understanding of household schooling decisions from econometric and economic analyses, this dissertation outlines some policy recommendations targeting children from low income families, children from middle income families with multiple school-age children, children with less-educated parents, and children from rural areas.